Six sigma for gamma-distributed processes: a case study in oil and gas

Abstract

Purpose The purpose of this paper is to study the relationship between reported sigma levels and actual failure rates (FRs) of gamma-distributed processes. The added complexity of the non-normality behavior of the gamma distribution is analyzed for the case of the cycle time (CT) of a real procurement process from the oil and gas industry. Then, recommendations and guidelines for the application of Six Sigma methodology for the case study are proposed. Design/methodology/approach Sensitivity analysis is conducted to study the relationship between gamma distribution parameters and FRs considering different quality levels. Then, adjustments for implementing Six Sigma programs for gamma processes are proposed. These adjustments consist of first determining the appropriate probability distribution, the standard CT and the due date, followed by setting performance zones and improvement strategies on target gamma parameters that yield the minimal FR. Findings For gamma-distributed processes, simply reporting the sigma level is not sufficient to capture the main characteristics of the process. These characteristics include process FR, mean setting, shape, spread and amount of variation reduction (i.e. improvement effort) required. That is why caution must be exercised when dealing with one-sided non-normal quality characteristics such as CT. Originality/value To the authors’ knowledge, this is the first time that the Six Sigma performance has been evaluated for gamma processes to analyze the link between Six Sigma FRs and gamma distribution parameters leading to the development of a modified Six Sigma methodology for non-normal processes.